Daily Market Cast: 3/20

Daily Commentary: Friday, March 20, 2026

Transcript

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Good afternoon. Today is Friday, March 20th. Gray markets closed the week with a softer tone as pre-weekend risk-off action creeped in across the broader market. Fundamentally, not much has changed, but the market's attention is firmly locked in on the Middle East as we head into the two-day break. Tensions remain elevated with the Strait of Hermuz still largely restricted. Israel signaled yesterday that Israel would support U.S. efforts to reopen the passage with Intel and other means, but the situation remains uncertain. Overnight, Iran and Israel exchanged strikes, with Iran reportedly targeting energy infrastructure in the Persian Gulf. At the same time, the U.S. Pentagon is deploying additional Marines to the region. From a micro standpoint, we also saw added pressure come from a stronger US dollar. The dollar traded higher on the session, still inside of yesterday's range, but the rebound following what looked like a key reversal lower on the daily chart caught the market off guard. That shift added another layer of headwind across commodities. This is a headline driven market right now, which micro is adding to the volatility. So let's step back. Two weeks ago, we kicked things off with fresh highs on a Monday. And then last week, on this past Monday, we followed up with a limit down moves. So this coming week, expect volatility to stay in the driver's seat. Direction may matter less than speed. Stay disciplined, stay flexible, and be ready for anything when Sunday night opens up. This week's all egg week article, what this week's sell-off really means, breaks down what just happened in the market and more importantly, what does and doesn't change. Also, Allison will be presenting for NCI, Northern Crops Institute, next Wednesday, March 25th on how the Middle East conflict is impacting grain markets. This will be a webinar format, and if you are interested in joining, can you you can register at the link below. On the corn, December corn pushed to within striking distance of last week's spike highs, and the market is clearly leaning on that$5 level. A clean break there could invite another wave of fund binding and quickly open the door towards that$550 area. And this is the December contract. This morning's pullback looks more like outside pressure than anything internal, with weaker wheat and softer energy dragging on the opening. Still, the broader tone hasn't tone hasn't changed. Bulls remain in control, backed by tightening global production estimates, ongoing dryness across parts of the U.S. corn belt, and a fertilizer situation that continues to escalate. Disruptions in natural gas infrastructure in the Middle East have forced fertilizer shutdowns, tightening a global supply. While the U.S. is somewhat insulated, many key producers are not, and that raises longer-term concerns about global yields into 2026. Domestically, the weather is turning back into a story. Dry forecast and warming temps in the western corn belt could quickly chip away at soil moisture, add in rising open interest on rallies, and the current market continues to show signs of underlying strength. Maycorn closed up down 4.25 cents at 465.5. December futures finished at 490 and three quarters, down 3.3 cents for the week. Maycorn futures did gain 13 cents for the week. On the soybeans, soybean futures continue to trade in the three-headed story. Policy, geopolitic, geopolitics, and demand uncertainty all pushing and pulling different directions. The market is starting to digest implementation of the 45Z tax credit, which remains a moving target. That directly impacts soybean oil demand depending on how it stacks up against other feedstocks, keeping both support and uncertainty embedded in the complex. A bigger driver, though, sits outside of egg. The Iran conflict has tightened the link between crude oil and soybean oil, making energy markets a key influence. When crude moves, bean oil tends to follow, and that has provided an underlying pillar of support. At the same time, the limit-down move in old crop earlier this week was a reminder of how sensitive soybeans are to demand headlines. The delay of the US-China summit likely takes expected Chinese buying off the table. With US beans roughly$2.50 above Brazil, the economics just don't work. The shifts in the conversation for price to politics and for now, expected demand should be dialed back. May soybean futures finished at$11.62.41. For the week, May soybean futures lost 49 and three quarter cents. In the wheat, wheat ended the week softer, but the bigger picture remains constructive. Prices are easing alongside modest weakness and crude, and the recent two-week consolidation looks more like a pause in the uptrend rather than a reversal. Weather continues to play a role with models showing higher chances for precipitation 10 days out across Texas, Oklahoma, and the western half of the northern plains. Geopolitical risk remains elevated. Russia drone strikes overnight hit two foreign-flagged grain vessels in Odessa, keeping uncertainty in focus. The global fertilizer situation also remains of major concern. The International Grain Council lowered both U.S. and world production estimates yesterday, highlighting fuel and fertilizer constraints that consider pressure on the yields. Despite today's softness, the bulls retained the edge. Energy markets are key and any significant pullback and crude could drag wheat towards support, but long-term fundamentals, tight global supplies, and ongoing food security concerns provide underlying support for this complex. May Chicago Wheat gave back 12.3 quarter cents to close at 5.95. May KCK futures closed at 606 down 21 cents, and May Minneapolis futures gave back 15 and 3 quarter cents, selling at 628. For the week, Minneapolis wheat futures lost 4.4 cents. On the livestock, this week was an interesting one for the cattle complex. To start, workers officially went on strike at the Greeley JBS plant in Colorado, effectively shutting it down and removing roughly 5,800 head per day from the keel. However, the market had already sold the future, sold the rumor, so this development did not push prices any lower. Another notable shift was that the cattle complex appeared to decouple from the financial markets. While broader financials closed lower on the week, both live cattle and feeder cattle contracts finished higher. This suggests the market is returning to trading its own fundamentals rather than outside influences. If the trend continues, it would be supportive as supply fundamentals remain bullish. This afternoon's cattle on feed report reinforced the outlook once again. There was no cash trade reported as of this writing. Packer margins are now at a break-even, which makes us think that cash should come in steady this week around 235. The actual numbers came in largely as expected, but leaned toward the very side of the neutral. On feed was the high end of the range at 100%, and placements were also at the high end at 104%. Marketings came in at the 93% near the top of the end of the estimates, and that was the only figure that could be considered supportive. However, even that number fell short of being truly constructive. Had marketings exceeded the average trade guess, the report might have been viewed more favorably. Instead, it simply met expectations without providing a bullish surprise. Overall, the report suggests the herd size remains essentially unchanged from a year ago, which continues to support the longer-term bullish narrative. Tight supplies are still intact. That said, while the fundamentals may lean bullish, the broader market environment does not. Outside pressures and overall sediment are not currently supportive, which could limit upside momentum in the near future. April live cattle were up 77.5 cents, closing at 235.05, and June was up$1.72, closing at$233.42. March feeders were up$2.47, closing at$357.75. And May feeders were up$2.95, closing at$246.37. Lean hogs on the other hand struggled this week, with all contracts closing lower for the second consecutive week. Seasonally hog prices tend to trend lower into April 1st, and this year it is following that pattern. Once the calendar turns to April, the trend typically shifts, with lean hogs often rally into the summer months. We look for this weakness to head into next week. Weekly support is now being challenged, so next week's close will be important for the Bulls if they are going to defend their long positions. April hogs were down 77.5 cents, closing at 91.27, and June was off 27.5 cents, closing at 104.47. April hogs are trading near the lean hog index, which is at 91.32. This is how we see it today.